BREXITING THE FASHION INDUSTRY: What’s Next For EU Creatives

Today while hearing how Brexit will actually benefit the British grown fashion talent and the industry, we can only remember those moments of recession and hopes for smaller economies benefiting from the same. Unfortunately those hopes proved to be delusional chatter of the recession apologists, thus we explore the ways British Fashion industry is trying to find a way out of this ongoing exiting drama.

While the vote came down almost two years ago, this initial shock had an impact on British stock, but also the state of the fast growing fashion industry. While at that moment it seemed it will take for eons for the UK to leave the laws of the European Union, the date is now closer than ever. British government is proud of the 38 billion american dollars the Fashion Industry (according to the British Fashion Council) brings in every year, but unlike any other the industry it is comprised of foreign nationals living in the UK as well as largely favourable EU export laws.

BREXIT DOOMSDAY SCENARIOS

To help prevent disastrous scenarios a lobbying entity named Fashion Roundtable was created trying to influence the British government during Brexit events. This Fashion industry oriented political consultancy was founded by former fashion stylist and parliamentary researcher Tamara Cinick. The consultancy aims to emphasize with the politicians the simple fact over 880,000 people are currently employed in the fashion industry in one way or another. Those people are rightfully dreading the post Brexit days for the fashion and design economy. Cinick and her group are working on giving a strong political voice to the fashion industry, who while as massive is often taken as frivolous and subsidiary by the people on power in British as well as other governments. While helping companies making sense of Brexit, Fashion Roundtable has also teamed up with the renowned SHOWStudio, a video fashion platform founded by photographer Nick Knight in an effort to further the discussion.

To help companies prepare for the dreaded date, the March 29th 2019, numerous consultancies have issued free reports and guides. British fashion law firm Fox Williams LLP has compiled “A Guide to Brexit for the UK fashion industry” to aid companies and professional in their preparation for the dreaded date. The guide points out a slew of important issues, however one of the most concerning ones for the British fashion industry is the changes to affect the “Made In The UK” staple. At the moment there is no law enforcing the percentage of production made in overseas for a product to be labeled as such. Coming March 29th, this is no doubt to change, with customs obligations and rules at hand may see the fashion brands declaring the origin in a different manner, in addition to the rising administrations and custom expenses. This sort of additional procedures are sure to cause additional processing cross border delays, currently eased by the laws of the European Union.

EU CREATIVES IN BRITISH FASHION INDUSTRY

With no free trade with the EU deal coming close before the exit date, the British trade with the 27 EU countries will fall down to the agreements made with the World Trade Organization – the WTO. Shortly, this means all the goods between the UK and the European Union, as well as UK and the joining EU members and non EU countries are to fall under tariffs assigned by the World Trade Organization. Until a different deal is made with the EU, the WTO rates will not benefit any of the UK based fashion brands nor other business. Due to Brexit’s ongoing problems, British fashion giants such as Burberry have changed their plans of growing domestic production.

The talent in the fashion industry is also coming under question, with the British Prime Minister Theresa May proposing all European Union citizens looking for work in the UK will require permit, favoruing only highly skilled workforce not available in Britain. A set of rules similar to acquiring a United States visa, analyzing the value of creatives seeking employment. Restricting the ease of movement now in place for workers in the fashion industry, who are in a massive percentage foreign citizens, will no doubt lead to shortage of labour resulting in increased costs, reflecting on profit margins and budgets of fashion companies.

NEW REGULATIONS

Other organizations are tackling the looming problem as well, coming out of London, The Creative Industries Federation (CIF) set to represent the interest of fashion as well as film and music creatives in the UK is already proposing much needed solutions. Dreading the prospect of companies refusing to tackle themselves in the endless lines of red tape involving the paperwork needed for EU citizens, CIF is proposing new regulations to enabling free movement of the creatives. CIF is proposing forming the paperwork for a creative freelancer visa, a different outlook to short term visa applications and the possibilities to enlist EU talent on the day of the project.

This creates even bigger and seemingly impossible issues for the free-lancers participating in the British Fashion economy, according to British Fashion Council’s analysis close to 100,000 people working in the industry are in fact freelancers.

Furthermore, if between the scenarios of Soft and Hard Brexit, the later prevails fashion business will have far less options. At the moment many are considering establishing European Union based subsidiaries to create additional business ventures, as well as reduced tariff access to the EU countries.

Finally, with endless chaos it is clear the British government is to go with a Hard Brexit strategy and the two years so far have proven to be a terribly short deadline. The transitional period is not capable to cope with the fast approaching March 2019 deadline, thus hoping for additional periods to be assigned in an effort to prolong the single market arrangements.